Developer Al Adelsberger addresses the Urban Renewal Agency during a work session Monday night detailing a proposed downtown grocery store. Adelsberger is requesting $500,000 in assistance from the Urban Renewal Agency to help the project come to fruition. (PHIL BULLOCK/The Observer)
URA hears presentation for $500,000 request to help establish downtown grocery store
That was the message developer Al Adelsberger delivered to the Urban Renewal Agency during a presentation for a proposed grocery store in downtown La Grande Monday night.
“The reality is we’re trying to be part of the solution,” Adelsberger said.
Adelsberger and grocer Troy Berglund hope to open a downtown market on the corner of Adams Avenue and Fourth Street — with funding help from the Urban Renewal Agency. The developer has put in an application requesting $500,000 in funding for the $1.5 million project.
The Urban Renewal Agency funds projects during each fiscal year, but they are typically capped at $75,000. In 2011, Adelsberger was approved for a $65,000 grant award to complete the Market Place renovations. Of that, $39,862 has been disbursed. The remainder will be disbursed when the city receives a certificate of occupancy. If the city approves this $500,000 request, funds would be disbursed in the form of a loan, which could convert to a grant if certain economic development criteria are met. Urban Renewal funds are derived from tax increases, beginning in 2000, on properties within the Urban Renewal District.
During his Monday night presentation, Adelsberger said Market Place Family Foods, which would be located inside the building formerly occupied by Blockbuster, is an extension of the Market Place vision for downtown. Berglund, who has owned and operated Mt. Joseph Family Foods in Wallowa County for almost nine years, said he is ready to expand.
“I’m a small-town grocer,” he said. “It’s time to broaden our horizons and get out to La Grande.”
The owners of Nature’s Pantry, Linda and Dennis Clayville, also spoke at the meeting, saying they are excited about the opportunity to work with Berglund.
“There’s no reason to butt heads,” Berglund said.
The grocer, who has been in the grocery industry since the mid-1970s, said he plans to utilize the building’s basement and buy product from Western Family Foods in bulk to bring competitive pricing to customers. He also said the store would bring 15 full-time jobs and nine or 10 part-time jobs, with full-time employees making $15 to $16 an hour.
The developer and grocer also said they believe, as the result of several feasibility studies, that the store is projected to bring in $3.6 million in gross revenue during its first year and would return more money to the community than chain stores do.
If the city isn’t willing to help fund the project, however, it likely will not happen, Adelsberger said.
Mayor Daniel Pokorney said this request is a tough sell to the public, especially since Adelsberger’s Market Place hasn’t opened yet.
The developer said that’s because he wants the center to open the right way.
“We’ve got to make sure these businesses open properly,” he said, adding that the upstairs portion of the project — which includes a restaurant, bakery and wellness center for Nature’s Pantry — is set to open this summer.
Adelsberger said he understands the skepticism from the city and will respect their decision.
“I get it,” he said. “If I were in your position I’d probably be scratching my head too.”
Pokorney said he is also concerned that the city is being asked to risk $500,000 of public funds and that the money would need to be borrowed.
Urban Renewal Agency member John Bozarth said that is the point of Urban Renewal and that no one else has come to the city with this kind of project before. Bozarth noted the private investment going into the project as well. The total project is estimated to cost about $1.5 million.
Following the presentation, the Urban Renewal Agency entertained public comments. The majority of those were optimistic about the project, although one speaker said the city should pay close attention to the agreement between the parties, if the agency decides to help fund the project, to make sure the city isn’t “on the chopping block.”
Before the project is placed as an action item on an Urban Renewal Agency agenda, the city plans to work out problems that need to be addressed to meet city requirements and nail down a time frame for the project.